Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.

The Internet giant is attempting to compete with Google Fiber, but its deal has a major catch.

On the positive side, "GigaPower" service, which is offered mostly in markets where the company competes with Google, offers very high-speed home fiber-optic Internet service for as low as $70 a month. That's the same price the search giant charges, and on the surface it seems like a fair deal.

The problem is that this price requires customers to opt in to AT&T's "Internet Preferences" program, "which gives the company permission to examine each customer's Web traffic," according to Ars Technica. This leads to targeted ads appearing when you visit websites, email offers coming to your inbox, and even junk mail sent to your home.

Opting out of the traffic-recording program will cost you a minimum of another $29 a month. Add in AT&T's phone and television service through GigaPower and you will pay as much as $60 a month in privacy fees to keep AT&T from snooping on you, according to the technology website. To make a bad deal even worse, certain installation and modem rental fees are waived for people who take the privacy-busting deal, making the cost for AT&T to not record your Web browsing even higher.

GigaPower promises speeds that are comparable to what Google offers. Source: Screenshot.

AT&T tries to sell this as a positiveYou have to give AT&T credit for gumption as its Internet Preferences Web page works really hard to sell the program as a positive. The company attempts to sell the idea that it offers better pricing in exchange for customers letting the company "use your individual web browsing information, like the search terms you enter and the web pages you visit, to tailor ads and offers to your interests."

AT&T would have you believe this is a good thing that won't necessarily lead to you receiving more ads when you are online (though it might) but getting ones "more suited to your interests." The company laid out the following examples:

If you search for concert tickets, you may receive offers and ads related to restaurants near the concert venue.

After you browse hotels in Miami, you may be offered discounts for rental cars there.

If you are exploring a new home appliance at one retailer, you may be presented with similar appliance options from other retailers.

The ads could come "online, via email or through direct mail." AT&T does promise not to directly sell your personal information "to anyone, for any reason. Period." That, however, is cold comfort when the company is exploiting your personal information to market to you.

AT&T is taking advantage of customersSure, some customers might want the type of advertising AT&T describes above. Most people might even be indifferent.

Where AT&T has gone wrong -- and why it's hard to see GigaPower as an alternative to Google Fiber for anyone with a choice between the two -- is that opting out should not come with a penalty fee. This deal might be more palatable if the company was more up front about what it is doing. Maybe if the base price were higher and customers received a discount for agreeing to have their Web activities tracked, Internet Preferences would seem a little less sinister.

That's a subtle difference, but one that would put more power in customers' hands.

Of course, doing it that way would mean AT&T would not advertise the same price Google offers. Listing a higher price and showing that it was willing to meet the search leader's deal only with a significant customer concession would make it clear that GigaPower and Google Fiber are not comparable even if their networks and speeds are.

Since GigaPower is being offered specifically as an answer to Google Fiber it's hard to see how any customer would pick the AT&T service over one that does not track their activities in minute detail.

Daniel Kline has no position in any stocks mentioned. He can't get Rockwell's "Somebody's Watching Me" out of his head. The Motley Fool recommends Google (A shares) and Google (C shares). The Motley Fool owns shares of Google (A shares) and Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Author

Daniel B. Kline is an accomplished writer and editor who has worked for Microsoft on its Finance app and The Boston Globe, where he wrote for the paper and ran the Boston.com business desk. His latest book, "Worst Ideas Ever," (Skyhorse) can be purchased at bookstores everywhere.
Follow @tworstideas